Monday, November 12, 2012

These guys would do middle-of-the-alphabet rounds (H-round, N-round etc.) that the Sand Hill Road crowd owned at 1/20th the valuation. They invested private placement style for accrediteds, giving the original VC's a nice bump in valuation while the AE principals got to act like they were in with the in crowd.

We were dubious as far back as 2008.
After the principals were hit with attention-getting fines, the last straw came when they were ordered to make a recission offer to some of their Fisker investors.

Recissions are brutal for that type of operator, they are not ordered when investors are making money hand-over-fist and tend to be accepted rather quickly by the investor and/or their counsel.

Sources say that many Advanced Equities brokers were told on Friday
that today would be their last day, and many have already begun
searching for new employment. A staff meeting is scheduled for later
this afternoon. It is currently unclear what will become of the parent
company that holds the broker-dealer, or of several AE offerings that
are currently in process.

Advanced Equities is best known for helping to raise large rounds of
financing for private companies backed by well-known venture capital
firms like Kleiner Perkins, Khosla Ventures and New Enterprise
Associates.
In September, Advanced Equities was charged
with misleading prospective investors on a pair of private placements
for private fuel cell maker Bloom Energy. Among the lies were that the
company had more than $2 billion in order backlogs (it only had $42
million) and that it had a $1 billion order from a national grocery
store chain (it was only $2 million). AE settled the charges by, among
other things, agreeing to pay a $1 million penalty....MORE

A late-stage venture funding outfit is foisting junky startups on investors--much to the benefit of the Sand Hill Road crowd.

It's
just the sort of improbable success that Silicon Valley adores. Two
young entrepreneurs have, in a mere five years, turned an obscure
Chicago venture capital firm into a presence visible from Sand Hill
Road. This year Keith Daubenspeck and Dwight Badger's Advanced Equities
Financial is on track to raise $1 billion for startups previously backed
by industry Brahmins like Kleiner Perkins Caufield & Byers,
Benchmark Capital, New Enterprise Associates and Vinod Khosla....